Great article from Salon on the fact that lower taxes have never been particularly good for our economy.

Though the Reagan zeitgeist created the illusion that taxes stunt economic growth, the numbers prove that higher marginal tax rates generate more resources for the job-creating, wage-generating public investments (roads, bridges, broadband, etc.) that sustain an economy. They also create economic incentives for economy-sustaining capital investment. Indeed, the easiest way wealthy business owners can avoid high-bracket tax rates is by plowing their profits back into their businesses and taking the corresponding write-off rather than simply pocketing the excess cash and paying an IRS levy.

Let’s jack them up. I had a stupidly low effective tax rate last year. And while we’re at it let’s talk about the wisdom of having a Fed that has said they’re never going to raise interest rates. How is that going to get the economy going? Telling business owners they’ll have free money available in perpetuity is going to do what? Make business owner postpone investing and hiring in perpetuity. Got to give them a reason to jump Fed!

Of course, we’re talking about religious beliefs here. You’re not going to be able to convince most people that they could have more and better roads if we raised taxes. No matter how stupidly obvious that is.

Trickle down is a myth. It doesn’t work. It hasn’t worked. The only reason it’s even pretended to work is because we had two major bubbles created by fraud that made it appear that our economy was still growing. Give up the dream.

In the US we like to “vote the bums out” every 4 years or so. It’s amazing how frequently we’ve done this in our history. Yet if you look at history we’ve gotten nothing for our effort.

This year I encourage you to try something different. Vote for the party in power. Give them an overwhelming majority. I think the best way to create real change is to strangle the Republican party off completely. The reason that Democrats have trouble reaching consensus is that they represent pretty much every reasonable adult in our nation. They’ve got fiscal conservatives, labor unions, most of the LBGT community, and most importantly the majority of US citizens vote for Democrats. Sure the electoral college and Senate give the appearance that there are a lot of people voting Republican, but it simply isn’t true.

I’m not saying the Democrats are deserving of your vote because they have all the answers. I think they’re deserving of your vote because they will be good stewards of your vote until the Republican party is choked off completely. Once Democrats get 60-70% of the vote almost all corporate funding will go either to Democrats, or to the best third party. Suddenly the Republican party will start having to compete with the Libertarians, Greens, and who knows whom else for cash and ideas. Votes that prove you follow through with your beliefs will again become important. Once this ecosystem emerges the Democrats unnatural majority will instantly evaporate as voters move towards viable third parties that more accurately reflect their views. Hopefully this could be done within just one or two election cycles.

So don’t vote the bums out this year, vote them in! Spread the word and vote for real change.

Just posted this is a comment on Spike’s piece at the Austinist on Whole Foods CEO Mackey and his stupid ideas to “fix” healthcare.

Mackey sounds like he’s got all sorts of great ideas and is the savior of private health-care. The problem is that his solutions don’t work. My company recently moved to an HSA (which he advocates). It’s only 20% less than our previous health plan, and yet it provides almost no benefits. The only benefit is for me. Since I and my family are healthier than average we can afford to bet (and make no mistake, HSAs are gambling) on the fact that we won’t be too unhealthy in a year to make it cost too much. And since our household makes more money than 80% of households in the U.S. we can afford the high deductible by putting away over $5000 a year as a hedge against getting sick. That $5000 is to cover our full deductible on top of the over $300 per month I pay. But how exactly does a Whole Foods “team member” afford that plan?

I wholeheartedly endorse these “healthy” plans as a benefit for workers. In much the same way that other employee assistance programs (gym memberships, flex time, etc.) are good. It’s great to encourage your employees to be healthy. But being healthy doesn’t prevent accidents, or genetic diseases, or disease caused by external factors like pollution.

It does not solve the problem of how a minimum wage worker without $2000 hanging around in the bank (because what percentage of workers in that bracket can afford to sock away over 12% of their income for health care? and then they’re supposed to save 12% for retirement too?) can afford care with an HSA. Maybe because I’ve had minimum wage jobs I realize how ridiculous that idea is.

HSAs exist. The market, that great god at whose altar Mackey worships, has wholeheartedly rejected them. Why? Because they cost too much and do too little. They’re health care for rich people. If you’re having trouble deciding where to invest your money an HSA might be for you. If you’re wondering how you’ll pay your rent this month, it’s probably not.

Until we expand the insurance base to include all healthy and unhealthy citizens it will become increasingly unaffordable. And conservatives have presented no ways to fix that. Democrats have presented three – socialized medicine, a public option, and requiring the purchase of health insurance. HSAs don’t fix this problem. They just temporarily make health care cheaper for employers. CEOs who think this is a solution rather than a stop-gap should be fired for being ridiculously short-sighted.

So the Republicans are voting on a number of non-binding resolutions in their primary this year. Most of them are fairly uninteresting, but then I got to this one:

The third proposition seeks to eliminate the federal income tax.

So in case you haven’t been following the Republican gubernatorial primary (and you should be, best reality show on TV), things are getting upended in the Republican world. An upstart tea-party candidate – Medina – has been making massive inroads. In the latest polls it looks like she’s trending to upset Hutchinson and the possibility of her being in a runoff with Perry is not out of the question. She has some interesting ideas and is smart and prepared. All things that are completely unexpected in a Republican candidate.

One of her radical platform ideas is to change our state to being completely dependent on the sales tax. Which I thought was crazy, but then I realized that Hutchinson and Perry were talking about building new infrastructure and creating new jobs without any additional revenue. I think that might be more crazy.

She’s getting this idea from this position paper. It requires that we raise sales taxes to some level that they are on parity with what’s raised via property taxes. I can accept the fact that there’s some level at which that can be done, and that they’ve basically done their math right. I think they have the base rate at somewhere around 12%. My guess is that would mean we’d see about 15% in Austin.

My gut reaction to this is the “sales tax is regressive” and it is. But in Texas I don’t see any chance of an income tax anytime soon, so perhaps regressive isn’t so bad. And the problem that I can’t figure out how to solve is rising property value. The most controversial part of Medina’s plan is that real estate will be taxed at time of sale (she’s actually backed away a little bit from this which I think is stupid, this is what the plan hinges on). So essentially the state still gets a decent income off of real estate. In addition homeowners on fixed incomes won’t be forced out of their homes. If they chose to sell they can. If not, they stay in their home. It’s a much better system than the community trusts that Austin has been playing with (although those are better than nothing).

While there’s an inherent boom and bust cycle to the sales tax, there’s also one for property taxes, as we’ve seen recently. So perhaps a lot of the traditional thinking on this one could be wrong. Neither property taxes nor sales taxes are good at extracting money from the rich, so I can’t really use that as a reason to recommend one over the other. You really have to have an income tax for that purpose. And I see zero change for that in Texas, so moving on…

That said, I’d really be interested in seeing what this does to our cities. Currently our suburbs are heavily subsidized by our cities tax dollars. They get to put in massive housing developments that have long roads stretching to other city’s massive retail centers. There’s the potential for this to change the way cities plan. Since they’ll be trying to get more of those tax dollars as their sole source of revenue they’ll have to add commercial into the mix for any new development. Since each house would no longer be a revenue source, a mix of x commercial would become required to sustain y amount of new development. Don’t know what the value of x and y are, but this could potentially do for mixed-use what good intentions alone could not.

Just got finished reading another press release from the Republican party headquarters that CNN passed off as an “editorial”. Let me see if I can sum up the Republican Party Platform:

• Let’s cut taxes. If a Democrat is cutting taxes it won’t work because they’re spending too much. We are against tax cuts by Democrats because our middle name is Goldilocks, and Democratic proposed tax cuts are too big/too small/too hot/too cold, while ours are just right.
• Let’s cut spending. If a Democrat proposes cutting spending they’re actually going to increase spending. This is a fact of nature. If someone points out times that Republicans increased spending we point out that all Democrats do is blame past Presidents.
• When in doubt blame Bill Clinton.
• Democrats are out of touch with the voters. If the majority of Americans approve of what Democrats are doing, it’s due to the bias of the mainstream media.
• Democrats have no plan. Republicans have a plan. The plan the Democrats just told you is not really a plan. Especially that really detailed plan with all of the dates and numbers. The Republican plan is not just to oppose the Democrat plan. And it no longer includes any of the things that were in the plan previously, but had to be taken out because Obama has put them in his plan.
• If Obama proposes any of the things we want to do, we immediately say he’s lying or call him a socialist. We must protect America from the creep of Obama’s socialist tax cuts.
• When in doubt blame immigrants and/or gays and/or inattentive parents.
• It is important to box ourselves into a corner as much as possible. Criticize the President for spending too much. Criticize cuts that do not affect Social Security, Medicare, or the Military as ineffectual. Criticize the president for not supporting the Military and wanting to cut Medicare and Social Security.
• Criticize as ineffectual any of our proposals the President suggests in an attempt to win our support.

I know it’s a press release because it cites Karl Rove as though he were someone who could provide one with unbiased facts.

A few of my thoughts. Julie eventually got too agitated to watch it so we quit over half way through.

1) I thought Medina came off pretty well, but then eventually went completely over the top. She threw in an “eliminate all property taxes” without in any way explaining it which sounded looney. That said, she also consistently countered Perry’s blatant lies with actual facts and figures. Which was great. I have no clue why Hutchinson wasn’t ready to do the same thing. (She did try, she just didn’t have the facts at her fingertips like Medina).

2) Perry was creepy. I thought Bush was creepy. Perry is like a really creepy animatronic Bush. He also appeared to be a bobble head doll with one arm on TV. It did not help matters. His answers were on message, but he really tried to get away with some statements that ranged from stretching to outright lies. He tried to use job numbers from 2007 and got called on it. He tried to claim he cut business taxes after raising them last year. It as classic Republican “they’ll believe me if I say it enough”.

3) While I give Hutchinson points for having a nuanced view on Abortion and actually trying to express it, she did so in such an inelegant way that it was laughable. She basically was trying to make the point that if Roe v. Wade was overturned there would be places in the United States where abortion was very, very legal and it would be quick car ride to get to them. Whereas under Roe v. Wade the federal government has control and can restrict abortions everywhere even if they can’t completely eliminate them. In other words Roe v. Wade gives the anti-abortion movement control at the federal level and thus is a good thing (in so far as it can be in her view). That said, she was obviously trying to avoid the headling “Hutchinson for Roe v. Wade”, and her answer danced and danced. It was patently ridiculous.

4) On the emminent domain question, Perry talked like Bush. He said he was extremely for emminent domain which I couldn’t tell if it was a freudian slip. He said he’d presented a bill for the voters, that they had overwhelmingly approved. It was a constitutional ammendement. But the worst part was they asked about farmers who felt they weren’t getting a fair shake with regards to access and new roads. He said he grew up on a farm (random). And then proceeded to give a completely tone deaf answer. He said the voters were overwhelmingly for tort reform and these farmers concerns were actually just trial lawyers trying to start a new cottage industry in frivolous lawsuits. Which possibly it is. But he really pretty much told rural Texas to take a flying fuck. And with a big ass smirk on his face.

5) Hutchinson quoted a figure from the Dallas Morning News and Perry said that he didn’t take them as a paper of record. WTF? The Dallas Morning News? That’s a Republican newspaper. I understand attacking “the media”, but attacking a right-wing news source, makes you seem ridiculous.

6) Perry brought up the fact that he’s not afraid to veto bills. But I think that misfired, since he just reminded people that he tends to veto bills that they’re counting on. Like the recent retired teacher bonuses bill.

I thought Medina was the only one who came off as being able to articulate a point. Unfortunately her points were a bit to wacko to be elected. She did a great job, though, of breaking through the current Republican trend of being able to flat out lie and have no one call you on it. I have no clue why Hutchinson didn’t do a better job of that.

Hutchinson looked somewhat human and gave the best answers. She talked about Texas being great right now, but needing to plan for the next 20 years. Which is a really good counter to Perry’s platform of nothing. I mean, he really had nothing. That said, he didn’t completely fall on his face, and Hutchinson wasn’t as compelling as she needed to be, so the advantage went to Perry.

Let’s get really pro-life. In addition to not letting Americans buy health plans that provide coverage for abortions, and not allowing the government to pay for abortions with tax dollars, I think we should also deprive health care funding for any prisons that have a death row. Seems fair to me.

Hey, I’m just taking a page from the Republican playbook.

So this meme has come up a lot recently in my life, and I’m trying to figure out where it comes from. There seems to be a Republican meme that the Obama administration is incredibly opaque. This is obviously completely false unless we’re comparing his administration to the administration he was describing while campaigning.

You know Texas has been lauded a lot as a new model for how to run a state. California (and Democratically run) is the old way and Texas (and Republican run) is the new way. Rick Perry certainly is quick to point this out.

But when you look at what’s really going on, about the best thing you can say for the state legislature and governor is that they stay out of the cities’ way. They’ve kept tax rates low which has allowed cities to raise more taxes. And past that they don’t interfere very much.

When you look at the power house cities in Texas, they’re all run by Democrats. Dallas, San Antonio, Austin, and Houston all have Democratic mayors. And those are really the cities that are being looked at when they talk about Texas as a great place to live and do business. The rest of Texas is poor, uneducated, and propped up by moving money out of the urban areas to help pay for the rural ones. They are a massive financial liability for the state. The places that don’t work are overwhelmingly Republican and run by Republicans.

There are Republican suburbs, but those are all simply leaching off of the good Democratic policy. They get the roads, the public transportation, and the business infrastructure paid for by the cities, and they can spend all their money on education.

So perhaps Texas is actually a Democratic triumph in spite of Republican inefficiencies. It looks that way from where I’m sitting.